The Ministry of Finance have developedthe draft law On Amending the Budget Projection (the “Draft law”) and submitted it to the Parliament on 23th August 2016. This Draft law introduces a number of changes to the tax and social health and insurance legislation which are aimed at increasing the budget revenues and decreasing the expenses.
Personal income tax:
- If an individual’s annual taxable income is up to MNT 30 million, it shall be taxed at 10 percent. If such income exceeds MNT 30 million, the tax should apply as MNT 3 million plus 25 percent on income exceeding the 30 million threshold.
- Interest income on deposits will be taxable.
Mineral royalty tax:
- According to the current law, a mineral royalty tax on gold is 2.5 percent, if gold is sold to the Bank of Mongolia or its authorized bank, and extra mineral royalty tax rate is zero.
- This zero rate should have been applied until 1 January 2019, however, the Draft law proposes to apply a zero rate until 1 January 2017 only.